Weeks: It’s Time to Get Obsessed

MELBOURNE, Fla. — According to Wallace Weeks, getting
obsessed with the business of selling home medical equipment is
going to be a must when it comes to surviving the harsh changes
that threaten to overtake the industry.

Five years ago, Weeks predicted that the HME sector could lose
25 percent of its then-existing providers by 2010. The industry
isn’t there yet — in May of 2005 there were 115,000 active
supplier numbers with current estimates at 98,000-plus, for a loss
approaching 15 percent. But Weeks believes that number is bound to
go higher, and not only because of competitive bidding.

“I think that with recent developments, in the next five years
we are going to see a great deal more fallout in the number of
providers. The decline is going to be tremendous, not only because
there is going to be a much more harsh environment but because of
an inappropriate response from providers,” he said.

Competitive bidding will obviously take a big toll, he said, but
“some of it will just be fatigue from providers’ having 10 years of
working in these circumstances.”

Looking ahead, Weeks continued, “It’s just going to be much
harder for an HME provider to make money. The companies that
survive are going to be the companies that are willing to sell and
service at the level that the market is willing to pay for —
that means what Medicare is willing to pay for.”

And that means providers are going to have to change their
values to make it, said Weeks, adding that “most providers won’t
change their values, particularly those that have been around a
long time …

“The people in this industry have to be without a doubt the most
caring bunch of people on this planet, and a lot of providers are
caring to a fault to their own detriment.”

Weeks has consulted in the industry since 1992 when he formed
Weeks Group to focus specifically on the HME sector. His company
“has gotten under the hood” to analyze more than 300 HMEs. The most
successful providers, he said, are those who are able to “quantify
where they are and where they need to be.”

But to move to the top in coming years, those analytical skills
must be coupled with “an obsession with managing the cost side of
the business,” Weeks said. “Obsession is pretty much where that has
to get to.”

Universal benchmarking is going to be another necessity, he
said. “How many times have we heard the questions ‘What is the
industry average?’ and ‘How does the rest of the industry do it?’
That’s not going to work anymore. Instead of looking to see who
does it best within the industry, we are going to have to pick a
process and see how the best in the world manage that process,
because people outside this industry are doing it better.”

Weeks is advising a start-from-scratch approach to deal with the
issues affecting providers’ profits and the HME market’s radical
changes. “Clean out the building and start over, detail by detail,”
he counsels in an upcoming HomeCare column. “Tell your
team to forget the way it is done. They are starting over. Forget
the resources they have and don’t have — nothing is off
limits.”

Weeks, who has been counseling HomeCare’s readers on
business and operations strategies in a monthly “Better Business”
column since 1998, recently announced a new start of his own: As a
commercial photographer (www.wallaceweeks.com), he will
specialize in the tourism, life sciences and health care
industries.

While his HME consulting business will end this year (instead of
speaking at Medtrade 2010 in November he’ll be on a month-long
photo shoot in Southeast Asia), he hopes his connection to the
industry will continue. “I hope to create photographs for home care
manufacturers and providers who advertise,” he said.

“Through the years [my wife] Lou Ann and I have worked with
thousands of great people,” Weeks said in an interview earlier this
month. “Now we are hoping our next ride will be even better, if
that is possible.”

Read Weeks’ “Better
Business” columns, including a collection of past columns in
the “HomeCare Experts” section. Soak up the advice in
Weeks’HomeCare columns through the rest of 2010.